Where Will All These Graduates Work?

Update on Law Schools and Careers

Positions for summer associates and law graduates will apparently be scarce in 2010, yet people are flocking to law schools as if there were no recession. Why is that? One explanation is that the study of law and other graduate and professional programs are generally considered to be "counter-cyclical," which means that interest in professional education tends to be higher when the job market is weak, as it is now. Hiding out in grad school? Maybe, but the law is still a good bet " though the profession may be in for some changes.

"This is a troubling economic time, but things will turn around," says University of Memphis Cecil C. Humphreys School of Law Dean Kevin Smith. "The economic pressures that are leading firms to reduce, will abate over the long term. Regardless of the economy, there is always a strong need for a good attorney. Most of the problems people face don't go away " there will always be a place for someone who is committed to assisting people in their times of trouble."

Vanderbilt Dean Chris Guthrie agrees: "Savvy students appreciate that legal education can help them obtain, and then excel in, a very broad range of careers in both the private and public sector."

At the National Association for Legal Placement's (NALP) "Roundtable on the Future of Lawyer Hiring, Development and Advancement"1 last summer, industry leaders created a snapshot of what they viewed as major issues for the legal profession's educating and hiring. Among the findings, the group concluded that the economic slowdown will have a lasting impact on lawyer hiring and development; corporate clients will continue to look for efficiencies; and law school curriculum needs to evolve to produce graduates who are more "practice-ready."

Applications Are Up and Hiring Is Down

The New York Times reported in August that this fall law students "are competing for half as many openings at big firms as they were last year and that is shaping up to be the most wrenching job search season in over 50 years."2 The timing is worst, the Times reports, "for the class of 2011 " the second-years now looking to get into firms " because of a unique logjam created last year" when after last September's financial crisis firms chose to defer their new hires. This has cut into recruiting this year, the paper reports.

The University of Tennessee College of Law's Dr. Karen R. Britton says "The job market woes have been slower to hit this region, and the hit has not been as dramatic as in the Northeast, but we have seen a definite decline in the number of students and graduates being selected for interviews and receiving offers." Britton is UT Law's director of admissions and financial aid and career services.

A physical sign that positions are fewer is that on-campus interviews (OCIs) have been, to a degree, curtailed. "OCI is in many ways an outdated, expensive concept for the employer," Britton says, so schools are searching for ways to entice firms in more economical ways. "Several employers conducted video interviews instead of coming on campus," she says, and some firms just asked for resumes of students rather than coming to campus." But still there were "a few" firms that completely cancelled scheduled on-campus interviews.

On-campus interviews numbered "slightly fewer this year," Dean Smith says. "Some of the firms that traditionally interview in the fall seem to be postponing until the spring to see what their needs are going to be."

Britton points out that a new model for law student recruitment may emerge: movement away from the traditional fall recruitment."A spring recruitment model would enable law firms to interview and hire later, when they can better predict their actual hiring needs," she says, citing NALP predictions. "Leaders in our industry are committed to considering changes that will suit employers of all types and sizes. The engine that drove legal hiring has slowed and the run and gun hiring environment that characterized the mid-2000s is simply not considered sustainable for the near future."

Nashville School of Law Associate Dean Virgina Townzen takes a practical approach: "I tell [potential students] that law firms are laying off attorneys and not hiring new associates at $100,000-plus salaries like they used to do and our law school is a good alternative if they plan to stay in Tennessee."

An American Lawyer survey of 2009 summer associates found that almost half of the respondents weren't sure whether they would get full-time offers, compared to only 17 percent last year and 12 percent in 2007.3

"Clearly, there were fewer graduates with jobs in hand at graduation in May 2009," Britton says. "That number approached 65 percent (at UT) when legal hiring was flourishing, but fewer than 45 percent of our 2009 graduates were employed at graduation."

Ben Adams, chairman and CEO at Baker, Donelson, Bearman, Caldwell & Berkowitz PC, says at his firm "overall hiring will be about what it's been " we had 22 new associates started this fall; we'll have 21 next year," but acknowledges there will be fewer spots for summer associates in 2010. "We have cut back on our summer program; it will be about half of what it was [last] summer."

But people still want to be lawyers: law school applications and admissions don't seem to be waning. According to the Law School Admissions Council, applications were up 4.3 percent for the 2009-10 academic year.4

"Who knows what that portends," Smith says, "but there seems to be a great deal of interest nationwide in legal education." At Vanderbilt demand is up, Guthrie says. "For the class that just entered, we received nearly 25 applications for every seat in the class."

Applications for admission at UT Law for Fall 2009 were up 5 percent, Britton says. "Students are clearly taking a 'consumer' approach to minimizing law school debt, with an understanding that a top salary is not a 'given' even if the job market rebounds."

Townzen points out that with NSL's tuition at $5,000 a year " and they allow students to pay in installments with no interest " students can graduate with no debt. "They are in a much better place financially when they start their legal careers instead of being strapped to a huge law school debt," she says.

And a lot of them will be starting legal careers, economic recession or not. About 205 will graduate this spring from Vanderbilt Law School, according to Elizabeth M. Workman, assistant dean for career services. In Memphis, which will graduate about 115 this spring, enrollment has been steady around 145-150 for the last several years, Smith says.

But it's not all smooth sailing. "Law firms have dramatically reduced their summer associate programs," Vanderbilt's Guthrie agrees. "In some instances, law firms have canceled them altogether; in other instances, they have scaled back the number of slots. We don't have exact figures, but our best guess is that there will be 75 to 80 percent fewer summer associate positions in 2010 than there were in 2009."

A Lasting Impact

As the NALP study suggests, the economic slowdown will likely have a lasting impact on hiring. In years past, the number of available law students has been relatively flat but the demand for students has been up, reasons Ben Adams, so the advantage has been with students. Jobs were plentiful; salaries were very high. But now more graduates are competing for fewer jobs " right alongside experienced attorneys.

"Now everything is reversed," Adams says, pointing out that in this economy clients have more leverage, for instance not wanting to pay for the work of first-year lawyers. He predicts that when the economy improves, "it will probably move back to a more balanced situation." But he doesn't see it bouncing all the way back. "I don't think it will ever go back to where it was prior to the recession. General counsel will be much more focused on legal costs and the predictability of legal costs " I don't see that changing."

Are Law Schools Producing What Firms Need?

All this uncertainty has brought up another, rather sticky subject: Are law schools doing their jobs? Are they producing what law firms need, and are new lawyers ready to "hit the ground running" when they arrive, degree in hand?

In October, an ALI-ABA-ACLEA Critical Issues Summit5 addressed topics relevant to the practice of law " and one of them was law schools. The general consensus was that schools are producing attorneys who are not capable of practicing law right away. What they need to be doing, attendees determined, is to provide more skills training, and serious consideration should be given to adopting the medical school model of training in the final year.

"I would like for them to have more practical experience at school so they could hit the ground running," Baker Donelson's Adams says, "whether it's trial skills, business drafting, negotiation skills. They need more practical knowledge."

And in a 2007 report, the Carnegie Foundation for the Advancement of Teaching concluded that most law schools gave only "casual attention" to teaching students how to use legal thinking in the complexity of actual law practice.6 Although central, the teaching of legal analysis "should not stand alone as it does in so many schools," the report concluded. Vanderbilt Law School has been grappling with this idea for at least four years, Guthrie points out, beginning with his predecessor Dean Ed Rubin. As a result, he says, "we have added two new courses to the first-year curriculum and increased the opportunities for students to specialize, and develop hands-on skills, during their second and third years of school. ... We have also invested heavily in our clinic, providing students with many more opportunities to work with clients."

Characterizing a desirable graduate as "practice-ready," Memphis's Smith points out that that real-world experience is essential: "We're looking to expand our clinical opportunities, number of externships and simulation courses that we can offer, and expand the opportunities for legal drafting and practice-based legal writing classes."

Virginia Townzen says all this talk is nothing new to her school. "What you see happening in other law schools is what Nashville School of Law has been doing for 98 years. While we teach the same legal theory as required in other law schools, historically our legal education has been a more practical one. Our faculty is practicing attorneys and judges. Consequently, our students learn in the classroom at night what happened in the courtroom that day."

It's not just hard skills that are needed in curriculum, the NALP Roundtable found. The group discovered the need for training in such "softer" skills as listening to clients and emotional intelligence, the need for communication between law firms and law schools, and the benefits of teaching law students about the economics of how law firms function.

But law students take heart: the basics of being a good lawyer and employee are unaffected. "You're looking at the same qualities that we've always looked for: talent, work ethic, commitment; someone who is capable of being part of team," Adams says. And in that respect, "nothing has changed."